Chris DeRose is a software developer, bitcoin evangelist and the controversial co-host of the podcast Bitcoin Uncensored. In this CoinDesk 2016 in Review special feature, DeRose provides his recap of the year that was, looking at ideas he believes proved fruitless for innovators and for the pursuit of better science and technology. Inconvenient as it may […]

My name is Rob Mitchell, and it?'?s hard to believe this is my 40th episode of The Bitcoin Game. I was a fan of Let?'?s Talk Bitcoin from day one, since it launched right after I got into Bitcoin. I reached out to Adam B. Levine early on, and worked with the LTB Network in various capacities. During that time, I recorded a number of interviews that weren?'?t quite publishable, for one reason or another. But after attending a Bitcoin Job Fair, I eventually collected enough solid content to release my first episode of The Bitcoin Game on October 15, 2014. A bit under 20 episodes per year isn?'?t so bad, is it?

Regular listeners are aware that my releases have been less frequent in 2016. So I felt extra pressure to do something special for my year-end, 40th episode. I sent messages to over 100 cryptocurrency enthusiasts, inviting them to record a holiday or new year greeting. I made suggestions, such as reviewing 2016 or making predictions for 2017, but I tried to make it open-ended. I ended up with submissions from 26 people who in some cases represent very divergent viewpoints. It?'?s a jam packed, ad-free show; I hope you enjoy!

Oh, before I forget?'

I want to propose that on January 3rd, the 8th anniversary of Bitcoin's genesis block, every cryptocurrency aficionado take a day to chill on the arguing, so we get a sense of what it?'?s like to be a huge, cohesive group. Can you go so far as to find someone you typically take issue with, and compliment them on something you genuinely value about that person? I?'?m just asking for one day a year. Who?'?s with me?

Guest Order Of Appearance

Greetings are in order from shortest to longest. Each guest's Twitter handle and relevant website are listed below.

Pamela Morgan

Arthur Falls

John Barrett

MAGIC WORD

Stay tuned for the magic word in this episode, and submit it to your LTB Network account to claim a share of this week's distribution of LTBCoin. Listeners have one week from the release date to claim the magic word credit.

SPONSOR

All participants in this episode are hereby offered their choice of a Bitcoin Keychain or a Bitcoin Fork Pen. In lieu of taking physical possession, a Counterparty token, redeemable for either product, may be requested. Simply contact Rob with a physical mailing address or Counterparty address.

CREDITS

The Bitcoin Game box art is based on an illustration by Rock Barcellos.

Non-holiday music by Rob Mitchell

Holiday Music Credits:

"It's Beginning To Look a Lot Like Bitcoin" by John Barrett

"Dance of the Sugar Plum Fairies", "We Wish you a Merry Christmas", "It Came Upon a Midnight Clear", "Angels We Have Heard on High", "Angels We Have Heard on High (Piano)", "Jingle Bells (Calm)", and "Oh, Little Town of Bethlehem" by Kevin MacLeod (incompetech.com). Licensed under Creative Commons: By Attribution 3.0 http://ift.tt/2ifvDGs

Bitcoin, digital currency and blockchain technology experienced another explosive year in 2016. While bitcoin breached the all-time high in USD market cap, several new digital currencies claimed a place in the spotlights as well, while the blockchain buzz arguably peaked it all.

Of course, Bitcoin Magazine kept up with all of it. Looking back on 2016, we compiled three top 6 lists, with our best-read topics in technology, business and news.

These were 2016’s six top stories in technology, by popularity.

6: BIP 151’s End-to-End Encryption

Communication between Bitcoin nodes — and between nodes and SPV clients — is currently not encrypted by default. Unless precautions are taken, data transmitted over the Bitcoin network can be tracked by internet service providers, open-WiFi providers and anyone monitoring the Bitcoin network.

But that may soon change. Bitcoin Improvement Proposal (BIP) 151, drafted by Bitcoin Core developer Jonas Schnelli, is designed to make encryption between Bitcoin nodes the standard. If widely adopted (and alternative Bitcoin implementation bcoin already did adopt the solution), this should make it harder to censor specific transactions or blocks, while potentially offering increased privacy to Bitcoin users.

Although not everyone believes BIP 151 is preferable over conventional methods such as Tor or VPNs, the proposal garnered a lot of interest among Bitcoin Magazine readers, securing a sixth place on our list for 2016.

5: The Lightning Network

Throughout most of 2016, the central topic of debate within the Bitcoin community was, undoubtedly, scaling. The question of how best to increase transaction throughput on the Bitcoin network was on nearly everyone’s mind, while preferred solutions vary.

As one of the most promising proposals, thelightningnetwork could just be a game changer. The innovative solution — which is especially suited for micropayments — should minimize the amount of “on-chain” transactions required, while also realizing instant confirmations and increased privacy.

The lightning network and similar, compatible projects like Amiko Pay and Thunder were first proposed in 2015, and are by now developed by at least six companies. In a best-case scenario, production-ready software could be launched this winter — though much depends on activation of the Segregated Witness soft fork as proposed by the Bitcoin Core development team.

Whether the lightning network will be as successful as many hope remains to be seen, but it was definitely one of the most popular topics on Bitcoin Magazine, placing fifth on this year’s list.

Multisig transactions are transactions that require multiple signatures to be valid. Using multisig, several people can for example share a single wallet and be sure no single person runs off with the funds. More recently, multisig has become the basis for more complex solutions, such as the lightning network.

Technically, multisig has been part of the Bitcoin protocol ever since Satoshi Nakamoto launched the code in 2009, though it was nonstandard during the first years. It became a standard part of the Bitcoin protocol in 2012. Over the four years since, multisig has become fairly common, with several wallets offering the option by default.

Multisig is probably still the most basic, but also the most used, smart contract application to date, which could explain why Bitcoin Magazine’s article on the topic is still among the most popular pieces on the website.

3: Ethereum and Turing Completeness

In many ways, 2016 was the year of Ethereum. The smart contract platform itself (Ethereum) and its native token (ether/ETH) experienced a boom throughout the first half of the year: ETH increased from less than $1 to over $20. And while the exchange rate has since dropped to around $8, it’s still one of the best-performing digital currencies of 2016.

The Ethereum smart contract platform, moreover, has been heralded by some as the future not only of digital currency but perhaps even of computing itself. While Bitcoin is somewhat limited in scope, Ethereum’s Turing completeness allows for the creation of any blockchain-based software application.

But Ethereum has also been through a rough second half of 2016. First, the high-profile multimillion-dollar investment platform “The DAO” was compromised, after which the Ethereum Foundation opted for a controversial emergency hard fork to restore lost funds — causing a split in the blockchain. Later, Ethereum was subject to a series of attacks, which had to be solved with more hard forks.

While some see this series of hard forks to be a useful process to make Ethereum more robust against future attacks, others question whether Turing completeness is really a desirable feature for a digital currency, after all.

Either way, Ethereum and its Turing completeness were the focus of much attention throughout 2016, securing a third place on our list.

2: Segregated Witness

First publicly presented a couple weeks before the close of 2015, SegregatedWitness was developed and tested throughout most of 2016 and officially launched late October of this year.

A centerpiece of Bitcoin Core’s scalability road map, the proposed soft fork could offer several benefits. Perhaps most important, Segregated Witness would fix malleability, in effect laying the groundwork for optimized versions of the aforementioned lightning network. The proposed protocol upgrade would also extend Bitcoin’s flexibility through script versioning; it includes an effective block-size limit increase and more.

However, throughout the last quarter of 2016, it became clear that activation of the soft fork is not a given. At least one mining pool — China-based ViaBTC — actively opposes activation of the Segregated Witness soft fork. Whether or not the proposal will be adopted could well turn out to be one of the most important stories of 2017 ...

For 2016, SegWit has secured second place on our list.

1: Zcash and zkSNARKs

Ethereum was not the only Bitcoin alternative to steal headlines in 2016.

Started off as an anonymity layer for Bitcoin back in 2013, Zcash launched as an altcoin in October.

The digital currency that is being developed by Zooko Wilcox-O’Hearn and his team immediately generated massive hype. Partly due to its controversial but heavily publicized “trusted setup,” partly due to its crazy market action shortly after launch and, of course, also partly due to its underlying technology: zkSNARKs.

A zkSNARK — the “zk” stands for zero-knowledge and the “SNARK” for Succinct Non-interactive Argument of Knowledge — is a novel cryptographic technique that guarantees the validity of transactions while revealing almost no data about these transactions at all. In Zcash, this is utilized to hide which addresses are transacting and how much money is sent. Zcash achieves a level of anonymity not seen before in any digital currency.

Bitcoin Magazine was as engaged in the Zcash launch process as the rest of the digital-currency world, securing the brand-new currency and its underlying tech the top spot in our top 6 tech trends of 2016.

Wednesday, 28 December 2016

Today the tides have turned. It's all too meta we're in the studio of The Crypto Show being interviewed by Richard Jacobs of The Future Tech podcast about The Crypto Show. A lot of fun and no commercial interuptions. We get into where the show started and where it's going

Scalability has been a central issue within the Bitcoin community for well over a year now.

Amongst the most promising innovations being developed are bidirectional payment channels. These can be extended to theLightningNetwork, allowing users to transact securely with minimal footprint on the blockchain. Performance of these solutions would be significantly improved by SegregatedWitness, the protocol upgrade proposed by the Bitcoin Core development team. However, the Segregated Witness soft fork has not activated yet.

Last week, four researchers from Imperial College London and Cornell University — Joshua Lind, Ittay Eyal, Peter Pietzuch and Emin Gün Sirer — proposed a different payment channel solution. Loosely resembling the OtherCoin concept, the researchers published a white paper detailing their implementation, dubbed “Teechan,” and successfully tested an early version of the software.

Speaking to Bitcoin Magazine, Eyal said he believes Teechan is superior to the proposed alternatives.

“Teechan is more efficient than other payment channels. It’s faster to complete a payment, and allows for more payments per second,” the Cornell University researcher said. “Plus, it doesn’t require any changes to the current Bitcoin protocol.”

The Good Ol’ Payment Channel

In essence, Bitcoin payment channels are just multisignature (“multisig”) addresses, but leveraged in clever ways.

Let’s say Alice and Bob want to open a payment channel between them. To do so, they create a 2-of-2 multisig address, for which each will generate and control one private key. Funds from this multisig address can be spent only if both Alice and Bob sign a transaction with their private keys.

Next, both Alice and Bob send funds to this address; perhaps one bitcoin each. This funding transaction is broadcast and recorded on the Bitcoin blockchain, so the bitcoins are “locked in.”

As such, the “channel state” is 1-1: they both have a balance of one bitcoin each.

Now, Alice wants to buy a pair of shoes from Bob worth 0.1 bitcoins. Instead of sending 0.1 bitcoins to Bob on the blockchain, Alice and Bob just agree that Bob should now get 1.1 bitcoins from the multisig address, and Alice 0.9 bitcoins.

As such, the channel state is 0.9-1.1. Alice has effectively paid Bob 0.1 bitcoins.

If Alice or Bob (or both) want to close the channel, they sign and broadcast a transaction from their multisig address, which pays each their share as determined by the latest channel state. In this case 0.9-1.1.

“The beauty of payment channels is that, in the meantime, Alice and Bob could have transacted thousands of times,” Eyal said. “As long as they don’t broadcast transactions to the Bitcoin network, they can keep updating the channel, effectively paying each other ‘off-chain’ as much as they want.”

Of course, there are some challenges in making all this work securely. Most important, payment channels require some kind of solution to ensure that counterparties sign off on a transaction representing the latest channel state. And payment channels require some kind of solution to ensure that counterparties sign off only on the latest channel state. (If Alice, for example, could broadcast an older channel state, it would allow her to claim the full 1 bitcoin even after she bought the shoes.)

Typical bidirectional payment channels solve this problem in novel ways that require time locks and other trickery. This works, but in some cases it requires a malleability fix (Segregated Witness) — which is still awaiting activation.

Lind, Eyal, Pietzuch and Sirer propose a different solution.

What’s in the Box?

Teechan, which stands for Trusted Execution Environment Channel, is a new payment channel protocol. Like Bitcoin itself, the solution is based on open-source software: transparent and verifiable by anyone.

But to ensure that Alice or Bob can broadcast the latest channel state and onlythe latest channel state, Teechan leverages “trusted execution environments” (TEEs). TEEs are secure hardware components included in Intel CPUs with Software Guard Extensions (SGX); many new computers have them. (See full list here.)

“With SGX TEEs, no one can ‘look inside’ to see what’s going on. Unencrypted data never leaves the chip, and so not even the owner of a computer with an SGX can observe what these chips are doing; they only see the end result,” Eyal explained.

With Teechan, both Alice and Bob first have their own TEE generate a public and private key pair. Because these keys are generated inside of the TEE, neither Alice nor Bob knows what “their” private keys are.

Then, Alice and Bob have their TEEs connect and swap public keys. As such, their TEEs can actually communicate in encrypted form, ensuring that Alice and Bob cannot decipher what their TEEs are communicating.

Alice and Bob’s TEEs swap their private keys, in encrypted form over their secure channel. So, both TEEs now have both private keys — while Alice and Bob themselves know neither.

Then, with these private keys, their TEEs establish a pretty regular payment channel. They generate a multisig address, which both Alice and Bob then fund with, say, 1 bitcoin. This funding transaction is broadcast and recorded on the Bitcoin blockchain and is “locked in.”

Whenever Alice and Bob pay each other, they update the state of their payment channel, all from within their TEEs. In practice, this just means their TEEs keep track of the channel state. And both TEEs will update the channel state only if both Alice and Bob agree.

Finally, if Alice wants to close the channel, her TEE uses both Bitcoin private keys to sign a transaction reflecting the latest channel state. This transaction is broadcast to the Bitcoin network, and both Alice and Bob get their funds as determined by the latest channel state. (If Bob wants to close the channel, of course, Bob’s TEE signs this closing transaction.)

The TEEs solve both main payment channel challenges. Since both Alice’s and Bob’s TEEs control both Bitcoin private keys, they can always be sure to get their funds out. And the reason Alice and Bob cannot broadcast older channel states is simple: the Teechan software won’t allow it.

All the Trust That's Required to Make It Work ...

All this really only leaves one problem: Alice could lie to Bob about using a TEE in the first place — or Bob could lie to Alice.

Even though they would claim they created their Bitcoin private keys inside of the TEEs, and even though they’d exchange encrypted messages, they could be doing all of this from a regular CPU. Alice could hold on to all of her keys, allowing her to also decrypt Bob’s Bitcoin private key. With it, she could take all the funds from the channel.

This is where a little bit of trust comes in.

By a process called “remote attestation,” Intel — the creator of the SGX CPU that both Alice and Bob use — has a way to verify whether Alice and Bob are telling the truth. Using a special private key that only Intel should have, the technology company can use the first package Alice and Bob send across (the encrypted funding transaction), and check that it was produced both with the Teechan software and from their TEEs. However, Intel does not get to see the the content of the package; it remains encrypted.

If Alice and Bob trust Intel not to lie to them, they can be sure their counterparty really created the funding transaction from their TEEs. Alice and Bob can be sure neither of them know the Bitcoin private keys for their shared multisig address.

This works well if you trust Intel. Though of course, for this very reason, some Bitcoin purists won’t like the solution. For one, they don’t want to have to trust anyone, not even Intel. And second, the solution is not entirely permissionless: it requires a remote attestation license from Intel, which so far has been difficult to obtain.

Eyal, however, believes these concerns are overstated.

“Anyone running their Bitcoin software on an Intel machine is already placing their trust in Intel, so trusting the SGX mechanism seems natural,” he said. “And if they don’t, there are alternatives TEEs, if one prefers another TEE vendor due to trust or availability considerations. Additionally, the trust is limited to the involved parties: the participants in the payment channel, and the TEE vendor. Anyone outside the channel — all other Bitcoin users — remain oblivious to the channel construction and trust relations involved.”

Roger Ver is one of the earliest Bitcoin investors and through his tireless evangelizing of the cryptocurrency became known as 'Bitcoin Jesus'. Roger joined us to discuss Bitcoin's incredible potential to foster liberty. We also discussed how the current stalemate about how to scale Bitcoin is threatening that potential. And, finally, the mining pool operated by his site Bitcoin.com that is supporting the Bitcoin Unlimited client.

Roger Ver is one of the earliest Bitcoin investors and through his tireless evangelizing of the cryptocurrency became known as 'Bitcoin Jesus'. Roger joined us to discuss Bitcoin's incredible potential to foster liberty. We also discussed how the current stalemate about how to scale Bitcoin is threatening that potential. And, finally, the mining pool operated by his site Bitcoin.com that is supporting the Bitcoin Unlimited client.

Centralization of mining pools is often considered one of the biggest problems Bitcoin faces. Only a handful of pools typically control well over half of all hash power on the network, and there is little indication this trend will reverse anytime soon.

While several dynamics contribute to pool centralization, one important factor is “orphan rates” — i.e., the number of mined blocks rejected in favor of conflicting blocks. Solutions to limiting orphan rates have been proposed, usually focused on decreasing block relay time. But, unfortunately, most of these solutions do not hold up very well if mining pools are willing to disadvantage competitors.

A different area of research trying to solve this problem is Directed Acyclic Graphs (DAGs), also known as “braided” blockchains. This solutions could tackle the selfish mining problem too... ifworked out properly.

Here’s an introduction.

“Orphans”

Whenever two blocks are mined at (or around) the same time, they both “race” over Bitcoin’s network to reach as many nodes as possible. The first of these blocks to have a new block mined on top of it becomes part of the longest chain and is therefore considered valid by the entire network.

The rejected block — while otherwise valid — does not become part of the longest chain, and is therefore disregarded by the network. The block is “orphaned.”

This means that all hash power spent to find that block was wasted. Valuable resources — like electricity — are lost, with no block reward to show for it. That’s bad news for the miner of the orphaned block.

Moreover, these mechanics open the door to types ofselfish mining attacks, firstdescribed by Cornell University researchers’ Ittay Eyal and Emin Gün Sirer. In short: large mining pools can strategically withhold blocks they mine to give themselves a head start against smaller competitors. This attack can be profitable even if a pool (or a combination of pools) controls as little as some 25 percent of all hash power on the network.

The best way for miners to mitigate these risks is to join a large pool and share profits. But, of course, this centralizes mining into fewer and larger pools, which is bad news for the decentralization of the Bitcoin network.

Braiding

Most solutions that deal with this problem — as described, for example, in thistwo-part article — attempt to minimize relay time, so blocks can find their way across the entire network faster. This shorter relay time decreases the odds of two conflicting blocks circulating over the network. It also cuts down the total number of orphans, and in many cases works quite well.

But these solutions only work well if miners are “honest,” and don’t attempt some kind of selfish mining attack. If large miners do attempt a selfish mining attack, it doesn’t matter much how fast blocks can propagate over the network. The blocks are withheld anyways.

Braiding offers a different solution.

Instead of speeding up propagation, braiding decreases the negative effect of slow propagation — and therefore also the negative effects of selfish mining.

In a braided blockchain, conflicting blocks are not orphaned at all. Rather, a subsequent block is built on top of both of the conflicting blocks. Both blocks become part of the shared history, and both blocks earn their respective miners a block reward.

The main challenge that arises when braiding a chain, is that there still needs to be a conflict-resolution mechanism for double-spend transactions. On a regular blockchain the solution is simple: miners decide which transactions they include in blocks, and the network agrees that the longest chain of blocks is valid. Braided chains require more novel solutions, such as voting schemes; this is where the different proposals vary most.

As an added benefit — assuming the double-spend problem is solved — braiding opens the door to significantly reduced block intervals. A perk of Bitcoin’s 10-minute block interval is that it’s relatively rare for two blocks to be mined at the same time by coincidence. However, as the block interval time decreases, the odds of conflicting blocks increase, which is undesirable.

Since with a braided chain conflicting blocks are no longer a significant issue, most proposals specify block intervals of much less than a minute.

Concrete Proposals

Braiding is not a new concept.

DAGs were firstproposed by researchers Yonatan Sompolinsky and Aviv Zohar in 2013, as the GHOST (Greedy Heaviest Observed Sub-Tree) protocol, aversion of which is implemented in Ethereum. About a year ago, Dr. Bob McElrath presented a different implementation of the idea — now called braiding — at theScaling Bitcoin workshop in Hong Kong. More recently,Sia developer David Vorick presented his braiding solution, called Jute, atScaling Bitcoin Milan. As well, Sompolinsky and Aviv Zohar, along with Yoad Lewenberg, proposed their latest braiding-like protocol, Spectre in December of 2016.

That said, the concept is, generally speaking, still in the research and exploration phase. By braiding a blockchain, new problems are introduced — including the aforementioned increased risk of double-spends, but also a potential higher inflation rate and changed fee economics.

And the bad news is that, because braiding is still in this phase of research and testing, these solutions probably won’t soon be rolled out on Bitcoin’s main chain. Furthermore, even if all problems were to be resolved, braiding probably wouldn’t be easily adopted by Bitcoin. All braiding proposals so far constitute a significant overhaul of Bitcoin’s mining protocol, and can probably only be rolled out as a hard fork — a switch to an entirely new network that users come to consider “Bitcoin.”

As 2016 comes to a close, bitcoin development remains at a crossroads. Take the long-anticipated scaling solution, the Lightning Network. An open-source project that aims to boost bitcoin's capacity to millions of transactions per second (and by extension the technology's value), it's code is nearly ready to go live. Yet, bitcoin isn't exactly ready for the […]

At a first, superficial glance, a Plantoid is “a welded mechanical sculpture on display in a public space — an aesthetic ornament that exhibits its mechanical beauty and begs to be appreciated by the public.” But the sculpture is only the visible part of a new, blockchain-based Artificial Life (ALife) form.

You can’t buy a Plantoid because it owns itself. If you like a Plantoid, you can show it appreciation by sending bitcoin to its wallet. Once a Plantoid has earned sufficient funds, it chooses an artist and commissions the artist to produce a new version of itself.

Of course, Plantoids are different from forms of life — e.g., plants, birds, dogs and people — we are familiar with. Yet, it can be argued that Plantoids meet a more general, extended definition of life, which is flexible enough to include cybernetic ALife forms and not just organic creatures. In fact, Plantoids acquire “energy” from the environment in the form of bitcoin donations, and use energy to move to new locations — for example, an art gallery that wants to exhibit a Plantoid — where they can acquire more energy, reproduce and evolve. The life, reproduction and evolution of Plantoids is ultimately mediated by people, but similar patterns are found in biological life and evolution. In fact, the relation between people and Plantoids is similar to the relation between bees and flowers.

The non-visible part of a Plantoid is a DAO — a Distributed Autonomous Organization with a set of smart contracts to manage the Plantoid’s life cycle and reproduction. The active members of the DAO (those who have donated funds or work to a Plantoid) participate, within rules set in the smart contracts, in decisions regarding where the Plantoid may be exhibited, exactly how it is to be reproduced, which artist will be selected to create the next generation, and how to allocate the collected funds.

Smart contracts on the blockchain that manage a Plantoid include specifications for governance rules and business logic. An interesting part of Plantoid business logic — a sort of “pyramid scheme” where part of a Plantoid’s income is sent back to its ancestry — encourages evolutionarily successful designs. Smart contracts for a Plantoid also specify the required aesthetic parameters (such as form, size or materials) that must be respected by the artist chosen to create the Plantoid’s offspring.

DAO members can submit proposals on how to implement the next Plantoid, or comment and bid on other members’ proposals. It is expected that different artists will implement different kinds of Plantoids, able to attract different types of donors or contributors to reproduce.

“Plantoid is an attempt at using art to illustrate what I consider to be one of the most innovative and disruptive aspects of the blockchain — the ability to create autonomous entities which are completely independent and self-sufficient,” says Primavera De Filippi, the Founder of Okhaos, the art collective behind Plantoid, as reported by Singularity Hub. “As a ‘blockchain-based life form,’ the Plantoid brings the concept of autonomy to a whole new level.”

Plantoids have no legal status at this moment, since the law does not recognize the legal personhood of DAOs, unlike corporations. However, it seems plausible that legal systems will recognize DAOs at some point, in which case Plantoids could legally own themselves. It’s also interesting to speculate on the possible evolution of Plantoids. The Plantoid ecosystem is designed for spontaneous Darwinian-like evolution to take over after the inception of the first Plantoids, and it seems likely that evolutionarily successful Plantoids will incorporate new emerging technologies.

For example, robotics and Internet of Things (IoT) technology could power future generations of more dynamic and interactive Plantoids. Another possibility, which sounds like science fiction but could one day become science fact, is that of intelligent Plantoids.

“We should think of smart contracts as applications that can themselves be decentralized, autonomous, and pseudonymously running on the blockchain,” notes futurist Melanie Swan in Blockchain: Blueprint for a New Economy, a 2015 book with a special focus on advanced future applications of distributed ledger technology. “Thus, the blockchain could be one potential path to artificial intelligence (AI) in the sense that smart-contract platforms are being designed to run at graduated stages of increasing automation, autonomy, and complexity.” Swan mentions Daniel Suarez’s science-fiction books Daemon and Freedom, in which “the world economy ends up radically transformed by the smart-contract type agents inexorably following their programmed code.”

The United Arab Emirates is ramping up blockchain development in a bid to become, by 2020, a leading center for innovation and the first government in the world to execute all of its transactions on a blockchain.

The move seeks to cut an estimated 100 million paper transactions annually and reduce the 25 million hours of work required in handling paper documents in Dubai alone.

Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Dubai Crown Prince, launched the Dubai Blockchain strategy in October, which aims at achieving a high degree of efficiency in government departments.

Another area of the strategy seeks to create thousands of new jobs by leveraging blockchain technology to allow Emiratis, expatriates and investors to set up companies more easily.

"The strategy will result in substantial economic saving that can be reinvested in value-added sectors and will contribute to saving millions of hours wasted in entering data and ensuring their veracity," said Mohammad Abdullah Al Gergawi, Vice Chairman of the Board of Trustees and Managing Director of Dubai Future Foundation.

"It will also create new economic fields and businesses as the volume of blockchain market is expected to hit US$300 million over the course of the next five years.”

The strategy is a joint project between the government's Dubai Future Foundation and Dubai Smart City Office.

Earlier this year, the Dubai Future Foundation launched the Global Blockchain Council, a public-private initiative that demonstrated the UAE's commitment to the technology.

Under the Global Blockchain Council umbrella, prominent financial institutions, technology firms and startups are collaborating on a number of pilot projects that promise to increase efficiency in processes, cut costs and create new business opportunities. Among these projects, a system called BitOasis aims at creating a blockchain platform "to secure [the] flexidesk contracts and registration process." Another project, called the Kraken Bitcoin Exchange, seeks to build a financial infrastructure for Islamic finance operations. Both pilot projects are being overseen by Dubai Multi Commodities Center Authority.

In September, Dubai Future Foundation kicked off the inaugural Dubai Future Accelerators, a 12-week program that seeks to connect international technology startups with government entities to create prototypes and pilots for the city of Dubai.

The program, which ended earlier this week, selected 19 out of the 30 companies to move forward to the pilot and prototyping phase. These will receive a total of Dh120 million (US$32.6 million) in investment.

Of the participating companies, 14 have already relocated their headquarters to Dubai, highlighting the city’s growing attractiveness.

“The UAE has become the foremost global platform for turning the future into reality,” said His Excellency, Mohammed Al Gergawi, Minister of Cabinet Affairs and The Future, and Vice Chairman of the Dubai Future Accelerators. “It is the ideal destination to materialize innovative ideas into tangible projects that have a significant impact on the economy and society — projects that can create better lives for us and for future generations.”

Among the companies that made it to the next phase, Loyyal, a loyalty and rewards platform, signed a deal with Dubai Holding for a pilot deployment aimed at creating the "internet of loyalty points, promotions and rewards" by using blockchain technology. Specifically, it will seek to provide an innovative and cost effective solution to enhance and connect different loyalty programs.

The pilot will focus on the Jumeirah Group and TECOM Group, Dubai Holding's sister company, bringing together their respective loyalty schemes to enable network-effect opportunities.

"We established the Global Blockchain Council here in Dubai less than a year ago, and are already seeing impressive advancements in the uptake of this technology," commented Saif Al-Aleeli, CEO of the Dubai Future Foundation and Founding Member of the Global Blockchain Council. "We are pleased by Loyyal's progress with Dubai Points, their partnerships with the private sector, and look forward to working even closer with them as they bring the blockchain future to reality."

As part of the deal, Loyyal will be deploying its proprietary and patent-pending blockchain and smart contract infrastructure solution to re-map the way Dubai Holding's businesses interact with consumers and each other.

Alongside Loyyal, other blockchain startups that were selected for program integration included BlockApps, an Ethereum compliant platform for the development, deployment and management of enterprise blockchain applications, and ConsenSys. The largest Ethereum blockchain software company in the world, ConsenSys, will develop a real estate database using blockchain technology for the pilot program.

The 19 pilot projects are expected to create 135 job opportunities in Dubai over the next three months, which is projected to increase exponentially when the projects achieve tangible results, and the companies expand their activities.

The second round of the Dubai Future Accelerator program will kick off in the beginning of Q1 2017 and will see five additional government and private entities joining in: the Department of Economic Development, Dubai Smart Office, the General Directorate of Residency and Foreigners Affairs, Etisalat and du, both telecom operators in the UAE.

Epicenter listeners who subscribe to the show on the LTB Feed probably noticed that they were unable to download the show for the last few weeks. There was an issue with the links we were posting to the LTB website. Well, we're happy to report that the issue has been fixed and that you can now go back an listen to episodes 159, 160, 161 and 162.